We completed the fifteenth audit report in our ongoing review of the Lower Manhattan Development Corporation’s (LMDC) administration of the $2.783 billion in Community Development Block Grant (CDBG) Disaster Recovery Assistance funds provided to the State of New York in the aftermath of the September 11, 2001, terrorist attacks on the World Trade Center in New York City. During the audit period, October 1, 2009 through March 31, 2010, LMDC...

We audited the Housing Authority of the County of Cook’s (Authority) nonprofit development activities. The audit was part of the activities in our fiscal year 2010 annual audit plan. We selected the Authority’s nonprofit development activities based on a citizen’s complaint forwarded to our office from the County of Cook, IL’s Office of the Independent Inspector General. Our objective was to determine whether the Authority administered its...

We completed an audit of the operations of the City of Binghamton, NY (City), pertaining to its administration of its Community Development Block Grant (CDBG) Section 108 Loan Guarantee program. Our audit objectives were to determine whether the City (1) administered its Section 108 loan program effectively, efficiently, and economically in accordance with applicable rules and regulations; (2) used Section 108 loan proceeds on eligible...

The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General (OIG), completed a review of loan origination practices of Anchor Mortgage Corporation (Anchor), Chicago, IL. Our objective was to identify violations of Federal Housing Administration (FHA) requirements and the related losses incurred by HUD. Based on our review, HUD sued the lender and its owner under the False Claims Act. In August 2010, the court...

We conducted a review of Federal Housing Administration (FHA) loans underwritten by Sterling National Mortgage Company, Inc. (Sterling), an FHA direct endorsement lender. The review was conducted as part of the Office of Inspector General’s (OIG) Operation Watchdog initiative to review the underwriting of 15 direct endorsement lenders at the suggestion of the FHA Commissioner. The Commissioner expressed concern regarding the increasing claim...

The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General audited the City of East St. Louis, Illinois’ (City) Community Development Block Grant (Block Grant) program. Our objective was to determine whether the City properly verified the eligibility of Block Grant-funded housing rehabilitation recipients. We found that the City awarded Block Grant funds to 143 recipients without adequately verifying their...

We completed a corrective action verification review of the audit recommendations for findings 1 and 2 of Audit Report Number 2006-NY-1005, issued February 21, 2006 pertaining to the general operations of the Utica Municipal Housing Authority, Utica, New York (Authority). The purpose of the corrective action verification was to determine whether the selected audit recommendations were implemented and the deficiencies cited in the report were...

The U.S. Department of Housing and Urban Development’s (HUD) Office of Inspector General audited the State of Illinois’ (State) Neighborhood Stabilization Program (Program). The audit was part of the activities in our fiscal year 2010 annual audit plan. We selected the State based upon citizens’ complaints to our office. Our objectives were to determine whether the State (1) had the capacity to effectively and efficiently administer its Program...

The U.S. Department of Housing and Urban Development's Office of Inspector General reviewed 20 Federal Housing Administration (FHA) loans that 1st Advantage Mortgage, LLC (1st Advantage), underwrote as an FHA direct endorsement lender. Our review objective was to determine whether 1st Advantage underwrote the 20 loans in accordance with FHA requirements. This review was conducted as part of our Operation Watchdog initiative to review the...

The U.S. Department of Housing and Urban Development’s (HUD) Office of Inspector General audited the DuPage Housing Authority’s (Authority) Section 8 Project-Based Voucher program (program). The audit was part of the activities in our fiscal year 2009 annual audit plan. We selected the Authority as part of our internal audit of HUD’s oversight of the program and based upon our analysis of risk factors relating to the housing authorities in...

We performed a capacity review to assess the Rochester Housing Authority’s (Authority) administration of its capital funding program. The Authority was awarded $5.9 million in capital funds under the Recovery Act. Our review determined that the Authority had weaknesses in its financial controls that if left unaddressed could lead to its having a diminished capacity to effectively administer its supplemental Recovery Act funds. Specifically,...

We audited the New Rochelle Municipal Housing Authority’s (Authority) administration of its Low-Rent housing program as part of the Office of Inspector General’s (OIG) strategic plan goals to improve the U.S. Department of Housing and Urban Development’s (HUD) fiscal accountability for its assisted housing programs. The audit objectives were to determine whether the Authority administered its low-rent housing program in accordance with...

We audited the New Rochelle Municipal Housing Authority’s (Authority) administration of its Resident Opportunities and Self-Sufficiency (ROSS) and Housing Choice Voucher Family Self-Sufficiency grant programs as part of the Office of Inspector General’s (OIG) strategic plan goals to improve the U.S. Department of Housing and Urban Development’s (HUD) fiscal accountability for its assisted housing programs. The audit objectives were to determine...

The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General audited the City of East St. Louis, Illinois’ (City) Community Development Block Grant (Block Grant) program. Our objectives were to determine whether the City properly expended Block Grant funds for salaries and building expenses and followed proper procurement processes while awarding significant administration contracts. The City did not properly...

We audited Somerset Investors Corporation (Somerset), dba Somerset Mortgage Bankers, a Federal Housing Administration (FHA)-approved direct endorsement lender located in Melville, NY. The audit objectives were to determine whether Somerset (1) originated FHA-insured refinanced loans in accordance with the requirements of the U.S. Department of Housing and Urban Development (HUD)/FHA and (2) conducted quality control reviews that complied with...

We completed the fourteenth audit report in our ongoing review of the Lower Manhattan Development Corporation’s (the auditee) administration of the $2.783 billion in Community Development Block Grant Disaster Recovery Assistance funds provided to the State of New York in the aftermath of the September 11, 2001, terrorist attacks on the World Trade Center in New York City. During the audit period, April 1 through September 30, 2009, the auditee...

We performed a review of the New York City Housing Authority’s (Authority) capacity to administer the approximately $423 million in capital funds awarded under the American Recovery and Reinvestment Act of 2009 (Recovery Act) in support of the Office of Inspector General’s (OIG) goal to report on Recovery Act recipients’ capacity to administer funds received. The objective of the review was to determine whether the Authority’s general,...